The Protocol
Last updated
Last updated
The OpenDelta Index Protocol functions as both a technology layer and regulatory framework for the creation of scalable index tokens on-chain.
The protocol consists of hybrid on-chain/off-chain infrastructure that allows us to efficiently scale while also leveraging the unique properties of smart contracts and enabling users of the protocol to share in the ownership and upside of the project in a fully decentralized way.
OpenDelta’s off-chain infrastructure allows us to custody assets on multiple chains, easily mint and redeem index tokens, put the underlying assets to productive use, and tap into the deepest and most liquid crypto trading markets. All of this enables users to get the simplest, fastest, and most cost-effective experience using our indices.
Multi-Party Custody
OpenDelta utilizes multi-party custody to hold, secure, and stake all of the index basket assets. For eligible assets, OpenDelta utilizes institutional-grade custody providers like Ceffu and Copper.
For assets not available on these services, we utilize an internal multi-party computation (MPC) setup built on MPC vault. This allows us to hold and trade these assets on both CEXs and DEXs while eliminating single points of failure.
Proof of Basket Assets
OpenDelta conducts periodic public proof-of-funds. We publish all of the addresses where we hold basket assets, and we perform periodic attestations to prove control of those funds. We also work with a third-party security firm to publish periodic public reports.
OpenDelta also leverages on-chain infrastructure to tokenize the indices themselves. This allows the indices to be liquid, tradeable, transferable, and composable across the Solana DeFi ecosystem. It also enables their easy integration into any front-end or user-facing application that supports SPL tokens.
Every index token tracks performance of a specific basket of assets.
Users who hold index tokens can stake them to get additional rewards. Rewards are being generated from productive activities of basket assets such as staking and lending and are being distributed among stakers of index tokens.
Staking rewards are paid out in index tokens itself. This means that the value of staked index tokens against index tokens increases over time. In other words, stakers will receive more index tokens than they originally staked at the point they decide to unstake.
